RGC Digital Marketing

By Kieran Frank

Why Should Businesses Continue to Invest in Marketing During Lockdowns?

During times of economic uncertainty or even when a brand’s net profit needs boosting, one of the first budgets to be reduced is marketing. The Covid-19 pandemic has been no exception, with many companies removing ads and slashing spending for months.

But pausing marketing spend is a terrible business decision, and here’s why…

Covid causes every brand to question itself. Since companies and their target consumers are going through a difficult time, brands tend to lean towards cutting back on advertising spend.

However, as one brand pulls its marketing spend, competing brands who continue investing reap all the benefits due to the rivals’ silence within the market. In this situation, the same ad spend suddenly provides substantially greater visibility for the resilient company.

As a result, pauses in advertising indicate significant revenue and market share reductions. Since greater business visibility leads to substantial monetary and business growth in the short and long run.

After all, the number of potential consumers will always remain relativity stagnant. But a company’s visibility can quickly fluctuate without sustained marketing efforts.

Businesses must grasp this idea to navigate through risky discussions about marketing strategy and expenditures. Non-marketers must realise that reducing advertising spending in uncertain times means sacrificing future revenues.

But this information coming from a digital marketing agency might seem biased, so let’s look at some tangible and peer-reviewed evidence.

Case Study: The Effect of Coca-Cola’s Halt to Ad Spend When Covid Hit

Faced with the uncertainty of the Covid-19 pandemic, numerous major corporations opted to decrease – and in many cases eliminate – their advertising spends for 2020.

According to the World Economic Forum, overall advertising investment fell 10% in the United States and 9% in Europe in the first half of 2020. According to the Interactive Advertising Bureau in Australia, 24% of Aussie businesses had halted all advertising and gone totally dark by the second quarter.

Among these statistics is Coca-Cola, who “paused” their global advertising efforts when the pandemic hit initially. Advertising spending was slashed by 35%, while the company’s communications budget was cut by almost $4 billion that year.

As a result, Coca-Cola faced the consequences.

Coke’s arch-rival PepsiCo – who maintained their ad spend through 2020 – gained a substantial advantage, reporting a 5% increase in net sales for 2020. Compared to the dismal 11% drop in net sales for Coca-Cola’s whole 2020.

Analytical Research: Demonstrates the Detrimental Impact of Pauses on Advertising

Of course, advertising spend is not the only factor that impacts revenue growth and reduction. However, new research from the Ehrenberg-Bass Institute shows how beneficial maintaining ad spend is for Australian businesses through economic troubles.

According to the Institute’s research, on average, business sales drop by 16 per cent after one year without advertising compared to the last advertised year. Then 25 per cent after two years, and each year just gets worse…


Impact of Pauses on Advertising


Conducted in 2018, the study used available data to monitor the media expenditure and volume sales of 70 Australian consumer goods businesses during a two-decade period. There are 57 examples of companies that stopped advertising for a year or more, with some companies not advertising for up to a decade.

Most significantly, the study found that business size matters!

There is considerable fluctuation around this average, as not all companies saw rapid sale decreases. In fact, after a year or two of no advertising, larger companies are likely to continue to expand or stabilise. But small businesses suffer more significant declines, with swift trajectory reverses and sales rapidly falling below base level.


Impact On Big Brands of Pauses on Advertising


While it may be tempting to cut advertising expenditure to increase profits, the research shows that doing so might lead to a business’s ultimate decline. As a result of advertising silent periods, your target market is prodded by rival advertising, and your crucial memory-based brand connections may fade.

And, because light brand purchasers make up the majority of any brand’s customer base and are the most essential segment for brand growth, the time spent off-air is costly, especially for smaller businesses.

So, Which Avenues Should Businesses Invest Their Advertising Capital in During Lockdowns?

Even though most of Australia is in lockdown due to the highly infectious Delta strain, digital marketers anticipate a big rush of demand for business products and services when we hit the 70-80% vaccination rates. So, to be prepared, businesses must begin taking steps now to ensure they are ready to launch during peak seasons.

We believe all Australian businesses – no matter the size – should focus on the following digital marketing services during lockdowns.

As all consumers have no choice but to do their shopping online, it is essential to capitalise on SEO Services! Search Engine Optimisation (SEO) strategies ensure whenever an individual searches on the web for specific keywords that relate to your business; your business website will appear as the first option. Holding the top spots on search engines will go a long way to securing valuable visibility online and a steady flow of FREE or unpaid enquiries to your business.

On the other hand, if you feel your business is experiencing a quiet period, capitalise on this with Website Upgrades! A business’s website is the primary source of information for stakeholders and potential customers. So, if you have been meaning to update your website, now is the time as when we come into the busy Christmas periods, your brand-new website will already be launched and ready to keep up with demand.

How Can RGC Help?

Currently, businesses are doing it tough with limited output and covid restrictions. Even though people can’t access products and services as quickly with shops physically closed, we see a constant flow of consumer searches online.

So RGC clients must continue to invest in digital marketing to meet the consumers where they are, ONLINE! Digital marketing ensures businesses still have enquiries coming through the door even in times of economic stresses.

It’s a harsh reality, but only the strongest will survive through this period. But Australians are finally seeing the light at the end of the tunnel, with Sydney having the fastest rates of vaccinations in the world at the moment!

To learn more about the Digital Marketing Services we provide, please call our expert team on 1300 770 985 today and get ranking! RGC Digital Marketing is a Digital Marketing Agency in Sydney that offers creative servicesweb design servicesSEO servicesdigital marketing servicesprogrammatic advertising, and many more services to improve our clients’ digital presence online.

Author: Ashley Regan-Scherf

Benefits Of Utilising An SEO Agency in Sydney
15 Eye-Opening Social Media Marketing Statistics Of 2023
Content Creators: Why Their Jobs Are More In Demand Than Ever
Getting Started With Google Search Console
6 Important Elements You May Have Forgotten In Your Web Design
Get Schooled On Digital Marketing in the Education Industry
Master Google Search Console With These 5 Strategies
Driving Engagement With User Generated Content
Threads: The Next Big Thing For Digital Marketers?
What a COVID-19 Second Wave Will Mean for Marketers
How To Optimise Your Blog Post For SEO Like A Pro
How Data is Fueling Digital Marketing in Automotive
Will Nostalgia Marketing Still Be Relevant in 2022?
Digital Marketing Trends Set To Make An Impact in 2024
RGC Won Website Feature Silver Awards For Client Websites
Not Sure Whether to Hire a Digital Marketing Agency? Here’s Why You Must
Should Your Small Business Invest In Web Design Services?
Mastering Google Ads On A Shoestring Budget
Why SEO is important during Covid-19 Lockdown
Discovering The Purpose and Power of Different Blog Types
LinkedIn Announces Removal Of Native Carousels – What It Means For You
See How Retail Can Use Programmatic to Personalise Advertising
Win Local Clients with Local SEO Services | Local SEO Agency
10 Tips To Increase Conversions With Web Forms
The Value of Google Merchant Center For E-Commerce Businesses
How Can Marketing Agencies Deliver A Winning Pitch?
The Importance Of Link Building For SEO
A Beginner’s Guide To Writing Metadata
How Smart Speakers Are Amplifying Sales In The Retail Sector
What Does Voice Search Mean For My Brand?
How A Website Redesign Can Increase UX & Conversions
Does Content Marketing Really Work? Content Marketing Agency | RGC
SEO News: Google’s December Core Update
RGC Wins at the 2017 Best Mobile Application Awards
6 Questions To Ask Your Digital Marketing Agency Every Month
Digital Marketing Hacks to Grow Your Business on Instagram’s New Shop Tab
The Evolution of E-Commerce in 2020
What has Social Media Taught Us?
The Importance Of Website Design In Building Your Brand
Google’s October 2023 Core Update Explained
15 Powerful Local SEO Statistics You Can’t Ignore in 2024
Programmatic Advertising Increases Customer Value for Insurance
Why Choose WordPress: Unveiling The Secrets Behind Its Popularity And Benefits
GA4: The Latest in Analytics Technology
SEM vs. SEO: Which Is Right for You?
Importance of Personalisation in Digital Marketing
How To Design A Website That Is Mobile-Friendly
Why You Shouldn’t Ignore The Role Of Social Media in Brand Building
ChatGPT: The Transformative AI System Changing The World of SEO
The Latest Insights Into Google’s November Core Update
Is Social Media Marketing Really Worth It?
How To Design A Scalable Website To Allow For Future Content
Instagram Shopping Helping Retail | Instagram Advertising Agency
Chatbots Improve Customer Experience for Insurance Industry
How Are Digital Marketing Agencies Really Using AI?
Revolutionise Your Service Marketing: Powerful Strategies for Success
Debunking the Top Graphic Design Myths: Uncovering the Truth for Creatives Everywhere
Steps To Creating A Successful Digital Marketing Strategy
8 Compelling Reasons To Choose Custom Web Design
That’s A Little Bit Personal, Isn’t It?
Recession Blues: Search Volumes Plummet But SEO Reigns Supreme
Need A Web Design Agency In Sydney? Here’s Why They’re Worth Your Time
5 Golden Rules for Choosing the Best SEO Agency for Your Business
How Digital Marketing Will Change Post Covid-19
Why QSR’s need to serve up Engaging Social Content
Web Mobile Application for Independent Locksmiths
Amazon’s Impact On The Retail Industry
How Can Digital Marketing be Effective for Schools?
Keep your automotive website on track with a local SEO strategy
Stop Twiddling Your Thumbs And Embrace The Chat Bot Era
Should Your Business Invest In SEO In 2024?
How Virtual Reality is Changing Digital Marketing in Real Estate
How Australians Used Social Media In 2015
Mitsubishi Electric and Sika join RGC
Proactive vs Reactive Consumer Marketing
Your Go-To Guide To Writing Killer Content
How Augmented Reality is Changing E-Commerce
A Guide To PPC Advertising
How to Create Marketing Leverage Opportunities for your brand
7 Simple Content Writing Tips To Master In 2023
Why Business Owners Need to Prepare for a Potential Google Departure
Brand Safety In a Programmatic Environment
RGC Wins 2016 WebAwards for Sika Retail
Designing Mobile-Friendly Restaurant Websites
How can a website help the automotive industry | Web Design Agency
Does Your Business Need An SEO Audit?
The Future Of Search: Inside Google’s Project Magi
RGC Wins Silver at the 2016 W3 Awards
5 Clever Ways to Build Your First-Party Database in a Cookieless World
How Digital Is Changing Retail
SEO in 2023: Stay Ahead With Cutting-Edge Trends & Proven Best Practices
Pushing The Envelope With Email Marketing
Local SEO Statistics Of 2023 Across 5 Unique Industries
What Is Off-Page SEO & Why Is It So Important?
How Image Recognition Is Changing Social Media Marketing
6 Elements that Build a Successful Client-Agency Relationship
Master Zero-Click SEO In 3 Easy Steps
How QSR’s feed their audience’s appetite for online food delivery
Fundamentals of Search Engine Marketing
5 Reasons Why Your Business Needs To Invest In Social Media Marketing
Unleashing the Power of Memory: Nostalgia Marketing Takes Centre Stage in 2024
Post-Pandemic Digital Marketing Trends That Are Here To Stay